Mitsubishi hangs up on U.S. phone market

Mitsubishi Electric will no longer sell cell phones in the United States and will close its North American sales offices, the company announced Friday.

The announcement ends a six-year effort by the company to gain a foothold in the U.S. cell phone market, taking on the likes of Nokia, Ericsson and Motorola. Its wireless division, Mitsubishi Wireless Communications (MWC), was launched in 1995.

Since that time, MWC has offered nine different types of cell phones to U.S. customers, most notably its Trium series. Two additions to the line of phones were expected later this year.

Company executives said the decision was due to the ongoing slump in handset sales. This year will likely be the first in which the number of cell phones sold was less than that of the year before, according to various forecasts from analysts including Gartner Dataquest.

"The erosion in Mitsubishi Wireless's North American business, starting in the year 2000, has forced Mitsubishi Electric to re-evaluate its global business strategies, just as its competitors have," Masumi Kosaka, president of MWC, said in a statement.

"We deeply regret that this decision had to be made as it affects our employees. However, we remain committed to support our customers in this market as we go forward," he added.

Mitsubishi plans to refocus its handset business into other markets, including Europe and Asia, according to the company.

As a result of Friday's announcement, MWC's offices in suburban Atlanta will be closed and 155 people, nearly all in sales and marketing, will be laid off. The division will be shuttered by March 2002.